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“Intel CEO Pat Gelsinger is putting the pressure on the U.S. government to help subsidize chip manufacturing, insisting the current reliance on plants in Taiwan and Korea as “geopolitically unstable.” Which panel of Figure 12.1 would represent a situation where the above lobby action is successful given the current increasing usage of chips? Figure 12.1 a) A b) B c) C d) D

Answer: Intel CEO Pressure on US Government to Subsidize Chip Manufacturing Intel CEO Pat Gelsinger is pressuring the US government to subsidize chip manufacturing in order to increase the reliability of chip production. Currently, chip production is heavily reliant on

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The diagram below shows the equilibrium position of Balloon manufacturers who are operating under pure competition because one company does not have an edge over another. The maximum economic profit (or minimum economic loss) for the firm in the diagram above would be a a) loss of R540 b) loss of R480 c) loss of R60 d) loss of R490 QUESTION 18 (4 Marks) The table below relates to profit maximisation in the labour market. Complete the table and answer the question below.

Answer: Understanding Profit Maximisation in the Labour Market Profit maximisation in the labour market is the process of determining the optimal level of production in order to maximise profits. This is done by taking into consideration the cost of labour,

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The diagram below shows the equilibrium position of Balloon manufacturers who are operating under pure competition because one company does not have an edge over another. The maximum economic profit (or minimum economic loss) for the firm in the diagram above would be a a) loss of R540 b) loss of R480 c) loss of R60 d) loss of R490

Answer The maximum economic profit (or minimum economic loss) for the firm in the diagram above would be a loss of R480. Explanation The diagram above illustrates a perfectly competitive market, which implies that the firms are price takers and

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This question refers to the figure below which shows the price, marginal cost, and average cost curves facing a perfectly competitive firm in the short run. What is the total daily revenue of the profit-maximising firm in the short run? a) R800 b) R2 000 c) R960 d) R720

Answer to Price, Marginal Cost, and Average Cost Curves Facing a Perfectly Competitive Firm in the Short Run The total daily revenue of the profit-maximising firm in the short run is R960. The firm’s total revenue is the area under

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This question refers to the figure below which shows the price, marginal cost, and average cost curves facing a perfectly competitive firm in the short run. (4 Marks) What is the total daily revenue of the profit-maximising firm in the short run? a) b) c) d) QUESTION 17 R800 R2 000 R960 R720

Answer: What is the Total Daily Revenue of the Profit-Maximising Firm in the Short Run? The total daily revenue of the profit-maximising firm in the short run is R2 000. This is determined by the price, marginal cost and average

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Use the diagram below, which indicates maximum combinations of good X and good Y that can be produced with available resources, to answer the question. On production possibility curve AC… a) output combinations D and E represent full and efficient use of resources, but A, C and F represent inefficient resource use. b) output combination D represents the most efficient use of resources. c) output combinations A, D, E and C all represent full and efficient resource use. d) output combination A and C represents less efficient resource use than either D or E

Answer The correct answer to this question is ‘C’. Output combinations A, D, E and C all represent full and efficient resource use. This can be seen on the diagram below, which indicates the maximum combinations of good X and

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In the fictional town of Wilsonville, there’s a bustling local economy with numerous firms and households. The local bakery, owned by Mrs. Smith, is a favorite among the townspeople for its delicious pies. Mrs. Smith buys her fresh apples from the local orchard, which is owned by Mr. Johnson. Meanwhile, Mr. Johnson and his family are regular customers at Mrs. Smith’s bakery, indulging in her pies every weekend. Use the diagram below to answer the question. What do arrows a and b represents? a) a – income; b – goods and services b) a – spending; b – factors of production c) a – spending; b – goods and services d) a – income; b – factors of production

Answer: What do arrows a and b represents? The diagram below is an example of a circular flow model representing the economic activity between households and firms. Arrow a represents income, and arrow b represents goods and services. This is

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Econoline Company produces only two goods and they operate with limited resources. The production manager decides to conduct an analysis of its production possibilities to determine the best use of its limited resources. They create a Production Possibility Frontier (PPF) diagram to represent the maximum combinations of good X and good Y that can be produced with their available resources. As the output of Good Y increases along the frontier, which of the following changes involves the largest opportunity cost? a) 0 to 5 units b) 5 to 10 units c) 10 to 15 units d) 15 to 20 units

Answer The Production Possibility Frontier (PPF) is a diagram which shows the maximum possible production of two goods with limited resources. It is used to illustrate the concept of opportunity cost, which is the cost of one option when another

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Mr. Jones, an entrepreneur living in Mozambique, saw an opportunity to make a profit by supplying chickens to the market in Mozambique. He argued that the slaughtering of millions of chickens in Mozambique, because of bird flu was causing a shortage of chickens. By importing chickens from Madagascar he believed that he would be able to make a profit by selling them in Mozambique, where the shortage of chickens would cause the price of chickens to increase. The following diagram represents the market for chickens before bird flu and the slaughtering of millions of chickens in Mozambique, Use the above diagram to explain what the possible impact of the slaughtering of chickens would be on the market for chickens in Mozambique, a) There would be a decrease in demand b) The demand curve would shift to the left. c) An excess demand would be created. d) The equilibrium price would decrease and the equilibrium quantity would increase

Impact of the Slaughtering of Chickens on the Market for Chickens in Mozambique The diagram above represents the market for chickens in Mozambique before bird flu and the slaughtering of millions of chickens in Mozambique. The slaughtering of millions of

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Housing prices in the UK are generally very high, particularly in certain areas of the country such as the South East. This makes it difficult for many people to be able to afford to buy their own houses. In England, average house prices are now almost 8 times the average worker’s salary; in parts of the West Midlands, the high prices have been caused by demand growing faster than supply. Source: (Gillespie: 2019) Figure 7.1 below shows how market conditions have changed in the housing market. Figure 7.1 market conditions and house prices Equilibrium has moved from P1Q1 to P2Q2. The most likely explanation for the changes shown is a a) Fall in mortgage interest rates and an increase in the number of houses built b) Fall in mortgage interest rates and a decrease in the number of houses built c) Rise in mortgage interest rates and an increase in the number of houses built d) Rises in mortgage interest rates and a decrease in the number of houses built.

Answer: The Most Likely Explanation for Changes in the Housing Market Figure 7.1 shows how market conditions have changed in the housing market in the UK, where average house prices are now almost 8 times the average worker’s salary in

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Econoline Company produces only two goods and they operate with limited resources. The production manager decides to conduct an analysis of its production possibilities to determine the best use of its limited resources. They create a Production Possibility Frontier (PPF) diagram to represent the maximum combinations of good X and good Y that can be produced with their available resources. As the output of Good Y increases along the frontier, which of the following changes involves the largest opportunity cost?

Answer: What is the Opportunity Cost of Increasing Output of Good Y Along a Production Possibility Frontier? The opportunity cost of increasing the output of Good Y along a Production Possibility Frontier (PPF) is the cost of the next best

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In recent years, there has been a growing trend towards healthier eating, and this has led to increased demand for brown bread. A 2022 survey by the Hartman Group found that 62% of consumers are trying to eat healthier, and 58% are looking for more whole grains in their diet. The following diagram illustrates the impact of an increase in demand for brown bread. Which of the following statements is INCORRECT? a) Before the increase in demand, the equilibrium price is R10 and the equilibrium quantity is 900. b) Owing to an increase in demand, the demand curve shifts from D to D1. At a price of R10, after the increase in demand, the quantity demanded is 1 200 and the quantity supplied is 1 100. c) At a price of R10, after the increase in demand, there is an excess demand. d) A new equilibrium position is formed after the increase in demand at an equilibrium price of R12 and an equilibrium quantity of 1 100.

Answer: Impact of Increase in Demand for Brown Bread The trend towards healthier eating has caused an increase in demand for brown bread. A survey by the Hartman Group in 2022 found that 62% of consumers are trying to eat

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The pricing strategies of MTN and Vodacom are shown in the table below. They must decide whether to charge a high or low price for their internet service. The four pairs of payoff values represent what each company expects to earn or lose in millions of rands, depending on the pricing strategy chosen by the other company. MTN’s Price Strategy Vodacom’s Price Strategy High Price Low Price High Price Vodacom +R200 MTN+R200 Vodacom +R500 MTN -R100 Low Price Vodacom-R100 MTN +R500 Vodacom+R100 MTN+R100 If it’s expected that the incomes of people living in rural South Africa is expected to increase, what will the equilibrium outcome be, ceteris paribus? a) Vodacom will charge a low price; MTN will charge a high price. b) Vodacom will charge a high price; MTN will charge a low price. c) Both Vodacom and MTN will charge a low price. d) Both Vodacom and MTN will charge a high price

Answer The answer is option b: Vodacom will charge a high price; MTN will charge a low price. This is because if the incomes of people living in rural South Africa is expected to increase, then the demand for the

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“Intel CEO Pat Gelsinger is putting the pressure on the U.S. government to help subsidize chip manufacturing, insisting the current reliance on plants in Taiwan and Korea as “geopolitically unstable.” Which panel of Figure 12.1 would represent a situation where the above lobby action is successful given the current increasing usage of chips? Figure 12.1 a)

Answer: Intel CEO Pat Gelsinger’s Lobby Action Pat Gelsinger, CEO of Intel, is pushing for the U.S. government to subsidize chip manufacturing. He believes that the reliance on chip plants in Taiwan and Korea is geopolitically unstable. If his action

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Consumer demand for meat has continued to rise throughout the pandemic, despite higher prices, according to a recent analysis from CoBank. Beef consumption has grown 1.4% from 2019 to 2021 even as combined retail prices increased by more than 20%, the report found. And for chicken, both consumption and prices hit record-high levels in 2021. But as beef prices continue to increase, consumers may begin to “trade down” when deciding which protein to purchase, CoBank said, with chicken most likely to benefit. The USDA is expecting a slight decline in beef consumption in 2022-23 as domestic supplies fall with shrinking cattle herds and growing exports, CoBank noted”. If the quantity demanded of chicken increases by 5% when the price of beef increases by 20%, the cross elasticity of demand between chicken and beef is a) 2.5 b) -4 c) 4 d) 0.25

Answer: Cross Elasticity of Demand between Chicken and Beef The cross elasticity of demand between chicken and beef is the degree to which the quantity demanded of one changes when the price of the other changes. Consumer demand for meat

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Complete the table and use the data to answer the question that follows. Units of labour (N) Total product (TP) Average product (AP) Marginal product (MP) 1 20 2 45 3 66 4 21 5 100 6 14 The marginal product of the fifth unit is a) 14 b) 16 c) 21 d) 2

Answer The correct answer is c) 21. Explanation The marginal product is the increase in total product that results from increasing the number of units of labor by one unit. To calculate the marginal product of the fifth unit, subtract

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The diagram below shows the equilibrium position of Balloon manufacturers who are operating under pure competition because one company does not have an edge over another. The maximum economic profit (or minimum economic loss) for the firm in the diagram above would be a a) loss of R540 b) loss of R480 c) loss of R60 d) loss of R490

Answer The maximum economic profit (or minimum economic loss) for the firm in the diagram above would be a loss of R490. Explanation The diagram shows that the firm is operating at the lowest point on the Average Cost Curve

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Answer the question by referring to the table below. The table shows the demand curve facing a monopolist who produces at constant marginal cost of 6. In short-run equilibrium, the monopolist will produce Quantity Price 10 10 20 9 30 8 40 7 50 6 60 5 a) 20 units b) 30 units c) 40 units d) 50 units

Answer The correct answer is D, 50 units. This is because the table shows that when the monopolist produces 50 units, the price is 6 which is equal to the marginal cost of 6. This is the quantity that maximizes

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Green Harvest Farms is a small agricultural farm that specializes in growing a unique and highly sought-after variety of organic tomatoes. These tomatoes have gained immense popularity due to their exceptional taste and quality. The market for Green Harvest Farms’ organic tomatoes is characterized by a perfectly elastic demand curve. This means that no matter how much they produce, they can sell all their tomatoes at the same market price without affecting the price. If Green Harvest Farms faces a perfectly elastic demand curve for its organic tomatoes, then: a) MR = AR = P b) MR = AR = TR/P c) MR = TR × P d) MR = AR × P

Answer The correct answer is (b): MR = AR = TR/P. A perfectly elastic demand curve means that no matter how much the firm produces, customers will buy all the units offered at the same price. The demand curve is

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Mr. Jones, an entrepreneur living in Mozambique, saw an opportunity to make a profit by supplying chickens to the market in Mozambique. He argued that the slaughtering of millions of chickens in Mozambique, because of bird flu was causing a shortage of chickens. By importing chickens from Madagascar he believed that he would be able to make a profit by selling them in Mozambique, where the shortage of chickens would cause the price of chickens to increase. The following diagram represents the market for chickens before bird flu and the slaughtering of millions of chickens in Mozambique, Use the above diagram to explain what the possible impact of the slaughtering of chickens would be on the market for chickens in Mozambique,

Answer: Impact of Slaughtering of Chickens on Market for Chickens in Mozambique The slaughtering of millions of chickens in Mozambique due to bird flu has caused a shortage of chickens in the region. This has had an impact on the

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Study the table below which represents the cost and price schedules facing a perfectly competitive firm that manufactures bulbs. Use this information to answer the question. This perfectly competitive firm will produce a) 3 bulbs, since losses are minimised. b) 4 bulbs, but it will consider shutting down in the short run. c) 4 bulbs, since at this production level it earns normal profit. d) 4 bulbs and will stay in operation.

Answer: Cost and Price Schedules Facing a Perfectly Competitive Firm The table below shows the cost and price schedules facing a perfectly competitive firm that manufactures bulbs. The table shows the total cost of producing different quantities of bulbs, the

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The table below gives the demand schedule for Whopper hamburgers Price Quantity Demanded A 10 0 B 8 4 C 6 8 D 4 12 E 2 16 Which of the following statements correctly describes the price elasticity of demand? a) The price elasticity of demand is larger at point A than at point B. b) The price elasticity of demand is constant because the slope is constant. c) The price elasticity of demand increases moving from point A to point B to point C to point D. d) The price elasticity of demand is larger at point D than at point A

Answer: Price Elasticity of Demand Price elasticity of demand is a measure of how the quantity demanded of a good responds to a change in its price. It is calculated by taking the percentage change in quantity demanded divided by

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The table below relates to profit maximisation in the labour market. Complete the table and answer the question below. If the wage rate were R160, it would be profitable for the firm to employ………… worker(s). a) 5 b) 1 c) 4 d) 2 QUESTION 19 (4 Marks) “Burger King Corporation is a Restaurant Company specializing in flame-broiled fast food hamburgers. It is the second largest hamburger chain in the United States, after McDonalds. A large hamburger called the Whopper is Burger King’s signature product. The Whopper was introduced in 1957, at a time when its competitor McDonald’s was still selling only sma

Answer: Profit Maximization in the Labour Market Profit maximization in the labour market is the process of setting wages and employment levels to maximize the profits of a company. When a company sets wages too high, it can lead to

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Housing prices in the UK are generally very high, particularly in certain areas of the country such as the South East. This makes it difficult for many people to be able to afford to buy their own houses. In England, average house prices are now almost 8 times the average worker’s salary; in parts of the West Midlands, the high prices have been caused by demand growing faster than supply. Source: (Gillespie: 2019) Figure 7.1 below shows how market conditions have changed in the housing market. Figure 7.1 market conditions and house prices Equilibrium has moved from P1Q1 to P2Q2. The most likely explanation for the changes shown is a

Answer: Housing Prices in the UK The UK has long been known for its high housing prices, particularly in the South East and other areas. This has made it difficult for many people to be able to afford to buy

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In recent years, there has been a growing trend towards healthier eating, and this has led to increased demand for brown bread. A 2022 survey by the Hartman Group found that 62% of consumers are trying to eat healthier, and 58% are looking for more whole grains in their diet. The following diagram illustrates the impact of an increase in demand for brown bread. Which of the following statements is INCORRECT?

Impact of Increased Demand for Brown Bread In recent years, there has been a growing trend towards healthier eating, which has led to increased demand for brown bread. A survey by the Hartman Group in 2022 found that 62% of

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Green Harvest Farms is a small agricultural farm that specializes in growing a unique and highly sought-after variety of organic tomatoes. These tomatoes have gained immense popularity due to their exceptional taste and quality. The market for Green Harvest Farms’ organic tomatoes is characterized by a perfectly elastic demand curve. This means that no matter how much they produce, they can sell all their tomatoes at the same market price without affecting the price. If Green Harvest Farms faces a perfectly elastic demand curve for its organic tomatoes, then:

Answer: Perfectly Elastic Demand Curve A perfectly elastic demand curve is a type of demand curve where a change in the quantity of a good or service supplied has no effect on the price of the good or service. This

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what is the cia in psm

What is the CIA in PSM? The CIA in PSM stands for the “Confidentiality, Integrity, and Availability” of a system. In the context of PSM, it is a set of security principles that are meant to ensure the security of

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John runs a small bakery in his neighbourhood, John’s Delightful Bakery. He bakes a variety of delicious pastries and bread, and his business has been quite successful. John used to work as a manager in a nearby restaurant before starting his bakery, and he quit his job to focus on the bakery. His salary was $25,000. To assess the overall performance of his bakery, John meticulously tracks his financials. For the year 2023, John has gathered the following information: · Total revenue from pastry and bread sales: $100,000. · Cost of ingredients and materials: $30,000 · Rent for the bakery space: $12,000 · Wages paid to his employees: $20,000 · Advertising expenses: $5,000 NB: · The bakery space could be rented out for $10,000 per year if John did not use it for his bakery. · John invested $40,000 of his personal savings into the bakery when he started it. These savings could have earned him a 5% annual interest in a bank savings account. Calculate John’s economic profit for the year 2023.

Answer: Calculating John’s Economic Profit for the Year 2023 John’s economic profit for the year 2023 can be calculated by subtracting the opportunity cost of his investments from his total revenue. The opportunity cost of his investments is the amount

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The diagram below shows the equilibrium position of Balloon manufacturers who are operating under pure competition because one company does not have an edge over another. The maximum economic profit (or minimum economic loss) for the firm in the diagram above would be a

Answer: Maximum Economic Profit/Minimum Economic Loss The maximum economic profit (or minimum economic loss) for a firm operating under pure competition, like the one shown in the diagram above, is determined by the intersection of the firm’s marginal cost and

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The pricing strategies of MTN and Vodacom are shown in the table below. They must decide whether to charge a high or low price for their internet service. The four pairs of payoff values represent what each company expects to earn or lose in millions of rands, depending on the pricing strategy chosen by the other company. MTN’s Price Strategy Vodacom’s Price Strategy High Price Low Price High Price Vodacom +R200 MTN+R200 Vodacom +R500 MTN -R100 Low Price Vodacom-R100 MTN +R500 Vodacom+R100 MTN+R100 If it’s expected that the incomes of people living in rural South Africa is expected to increase, what will the equilibrium outcome be, ceteris paribus?

Equilibrium Outcome of MTN and Vodacom’s Pricing Strategies The pricing strategies of MTN and Vodacom are based on game theory. The four pairs of payoff values represent what each company expects to earn or lose in millions of rands, depending

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Since graduating from UA, Anthony has been making deposits of $150 at the end of each month to an account paying interest at 7% compounded semi-annually. How much money will be accumulated in the account at the end of 4 years if: a) simple interest is paid for part of a conversion period; b) compounded interest is paid for part of a conversion period?

Answer Anthony will accumulate a total of $7,684.20 in his account at the end of 4 years if he makes monthly deposits of $150 and the account pays 7% interest compounded semi-annually. This can be calculated using the formula for

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Mr. Jones, an entrepreneur living in Mozambique, saw an opportunity to make a profit by supplying chickens to the market in Mozambique. He argued that the slaughtering of millions of chickens in Mozambique, because of bird flu was causing a shortage of chickens. By importing chickens from Madagascar he believed that he would be able to make a profit by selling them in Mozambique, where the shortage of chickens would cause the price of chickens to increase. The following diagram represents the market for chickens before bird flu and the slaughtering of millions of chickens in Mozambique

Answer: Mr. Jones observed that bird flu had caused the slaughtering of millions of chickens in Mozambique, leading to a shortage in chickens. This shortage created an opportunity for him to import chickens from Madagascar and make a profit in

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